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Corporate Political Donations Undermine Pledges


Breaking: Carlyle announced this morning that one of its chief executives, Glenn Youngkin, will step down, leaving Kewsong Lee as the investment giant’s sole C.E.O. (Want this delivered to your inbox each day? Sign up here.)

Corporate leaders increasingly outspoken on some important issues, but there is a contradiction between their words today and the role they played in creating the moment we find ourselves in, Andrew argues in his latest column.

Companies have funded political efforts antithetical to their public stances, according to the Center for Political Accountability. The nonpartisan organization analyzed donations over the past decade to six state-level political associations known as “527s,” named after a section of the tax code. Public companies were the biggest donors to the groups supporting governors, state attorneys general and local lawmakers.


That money supported candidates who undermined the causes companies claim to care about, especially on social and environmental issues. That included state attorneys general working to undo the Affordable Care Act, as well as local legislators trying to roll back L.G.B.T.Q. rights and federal climate change initiatives.

• “Companies aren’t paying attention,” Bruce Freed, the president of the Center for Public Accountability, told Andrew. “They give to these groups and that’s essentially where their due diligence stops.”

But, but, but … Companies push back with two common refrains:

We donate to both parties and have no say over how the money is spent. Getting access to and currying favor with politicians gives companies influence over taxes, regulations, contracts and other issues. But it also means giving some money to figures that the donors wouldn’t choose to support in isolation.

The donations are small. Indeed, they’re usually under seven figures — a rounding error for blue-chip companies like Walmart or Microsoft — but when pooled together the money can have an outsize influence on state-level politics. And if the result is the election of politicians who change the rules for everyone in a state, it could undermine all the time, effort and money that companies devote to certain causes.


📞 Join us on Thursday, July 23 at 11 a.m. Eastern for a DealBook Debrief conversation with David Sanger, The Times’s national security correspondent, who will discuss how the U.S. and its allies are pushing back against China’s tech giants like Huawei and TikTok. Sign up here.


Credit…Douglas Magno/Agence France-Presse — Getty Images

Coronavirus vaccines are showing promise. Three sets of developers — Oxford University and AstraZeneca; CanSino Biologics; and Pfizer and BioNTech — published positive early results from clinical trials yesterday. But shares in AstraZeneca fell as analysts worried that its treatment, the most closely watched, offers fewer benefits.

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A lab diagnostics giant warns of a backlog. Quest said it couldn’t increase its coronavirus testing capacity for the fall flu season. It’s struggling to meet demand already, and said an alternative way of detecting Covid-19 cases must be found.

Thousands walked out of work to show support for the Black Lives Matter movement. American workers in a range of industries participated in “Strike for Black Lives” to demand that employers “dismantle racism, white supremacy, and economic exploitation.”

Warren Buffett has lost billions (on paper). Berkshire Hathaway has erased $90 billion in market cap so far this year, the fund manager Will Hershey of Roundhill Investments pointed out. That’s among the biggest declines of any publicly traded company.

The blockbuster movie of the summer has been postponed indefinitely. Warner Bros. pushed back the release date of “Tenet,” the Christopher Nolan thriller that Hollywood had hoped would signal a return to normal moviegoing. A surge in infections has made reopening theaters a dicey proposition.

Credit…John G. Mabanglo/EPA, via Shutterstock

There may be a pandemic, and a recession, but in the past day there was also an avalanche of deal announcements.

EBay said today that it would sell its classified-ads business for $9.2 billion in cash and stock to Adevinta of Norway. It’s one of the biggest tech deals of the year, and will create the world’s largest online classifieds company.

Ant Group, the financial arm of China’s Alibaba, said yesterday that it plans to go public this year in Hong Kong and Shanghai, in what could be one of the biggest I.P.O.s on record. The company was last valued two years ago, at about $150 billion, but recent private trades suggest a valuation around $200 billion.

Chevron struck a $5 billion deal to buy Noble Energy yesterday, in what may be the first of a wave of oil giants buying smaller, weaker rivals.

Walmart has restarted talks about selling most of Asda, its British grocery division. Competition regulators blocked a merger with J Sainsbury last year; Walmart announced fresh discussions in February, then suspended them during the crisis.

Corporate boardrooms clearly still have confidence in deal-making, perhaps more than could be expected during a pandemic:

• Some 22,600 takeovers had been announced so far this year, according to Refinitiv, down 18 percent from the same time last year. But the total dollar value was down 38 percent, implying some caution. (And then there are the buyers getting cold feet.)

• Buoyant equity markets have also coaxed companies to resume planning for stock listings. Candidates include potential giants like Airbnb and Palantir, the data-mining consultancy.

Michelle Leder is the founder of the S.E.C. filing sitefootnoted*. Here, she spots a shift in the relationship between Google and Uber. You can follow her on Twitter at@footnoted.

Late on Friday, Uber quietly disclosed that it had entered into a new mapping agreement with Google. An Uber spokesman, Noah Edwardsen, said it updated a deal struck in 2015, before Uber was publicly traded.

The agreement is as notable for what it represents — a détente between the two tech heavyweights — as for its particulars. The relationship between Uber and Google has had ups and downs: up when Google’s venture arm invested in Uber; down as the search giant started its own self-driving efforts and Uber tried to create its own mapping tools; and abysmal when Google sued Uber over claims of stolen technology. The companies settled in 2018, and the former Google-turned-Uber engineer at the center of the case pleaded guilty to stealing trade secrets earlier this year.

Interestingly, the new agreement changes the pricing model. In the filing, Uber said pricing would now be “based on the number of billable trips taken using the services, instead of the number of requests. The transaction also includes tiered volume-based discounts.”

Friday’s agreement doesn’t include financial details, and Uber wouldn’t comment beyond what is in the document. A CNBC report shortly before Uber went public last year valued the earlier agreement at $58 million over three years. That deal was first disclosed as part of the company’s I.P.O. documents, although many of the details, including pricing, were redacted. The new pact runs for four years.

Credit…Pool photo by John Thys/EPA, via Shutterstock

The E.U. agreed today to a 750 billion euro ($857 billion) package to rescue itself from the coronavirus recession, with moves that bind its 27 members closer than ever. It took nearly five days of intense — masked and distanced — haggling in Brussels, and The Times’s Matina Stevis-Gridneff chronicled the twists and turns.

A major step is the collective selling of bonds, rather than countries selling debt individually. Roughly €390 million will be passed on as grants rather than loans, a huge concession to hard-hit southern countries.

It’s a shift in E.U. norms, driven by a new negotiating dynamic. Chancellor Angela Merkel of Germany, whose country has traditionally led Europe’s fiscal hawks, spearheaded the agreement, aided by President Emmanuel Macron of France.

And it’s an acknowledgment of dark days ahead, with Europe facing its worst recession since World War II. (European banks could face as much as €800 billion in loan losses, according to a new estimate by the consultancy Oliver Wyman.) “Exceptional situations require exceptional measures,” Ms. Merkel said today.

• Compare that with the U.S., where Senate Republicans and the White House remain trillions of dollars apart from House Democrats over the next coronavirus spending bill, with pandemic aid for Americans poised to expire.

Credit…Charles Dharapak/Associated Press

The landmark financial regulation, which ushered in sweeping changes to oversight of Wall Street, became law a decade ago today. It’s worth checking on its legacy — and its prospects.

The law restored confidence after the 2008 financial crisis, one of its authors argues. The former senator Chris Dodd, Democrat of Connecticut, writes in an op-ed for Law360 that the regulations “resulted in unprecedented levels of capital and liquidity in the banking system, and transparency and accountability where there was little.” Forcing banks to maintain much bigger capital cushions is a change that has endured:

But not everything has lasted, as American Banker notes. The Supreme Court sharply curtailed the independence of the Consumer Financial Protection Bureau, which Dodd-Frank created. And Republican lawmakers have eased many of its rules for banks, like the so-called Volcker Rule restrictions on risky trading.

A star-studded webcast will mark the law’s anniversary today. Hosted by Better Markets and George Washington University’s law school at 1 p.m. Eastern, the event will feature former President Barack Obama, Chris Dodd, former Representative Barney Frank, the former F.D.I.C. chair Sheila Bair, the former Citigroup C.E.O. John Reed, Senator Elizabeth Warren and Representative Maxine Waters.


• Shareholders in the Japanese messaging company Line are poised to revolt over a plan to merge with Z Holdings, a SoftBank affiliate. (FT)

• KKR has raised $950 million for a fund focused on the riskiest parts of commercial mortgage-backed securities. (Bloomberg)

Politics and policy

• Antispam contractors for AT&T, T-Mobile and Verizon blocked thousands of voter-outreach texts from the Trump campaign. (Politico)

• British officials reportedly told Huawei that they may revisit a ban on the company’s 5G products if Joe Biden wins. (Observer)


• Amazon, Apple, Facebook and Google are battling with Congress over the format of hearings next week in which their C.E.O.s will testify. (Politico)

• Tech companies are starting to flee Hong Kong after China imposed a new security law there. (Bloomberg)

Best of the rest

• It has taken a pandemic to convince many dive bars to clean up. (WSJ)

• “The Summer Friday Isn’t Dead. You Just Have to Be a Bit Creative.” (Bloomberg)

• The first pitch at the Washington Nationals’ opening day will be thrown by the infectious disease expert Dr. Anthony Fauci. (Vulture)

We’d love your feedback. Please email thoughts and suggestions to dealbook@nytimes.com.


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